In an extensive and exclusive interview to the DayAfter Think Tank Team, the Union Minister for Heavy Industries and veteran politician from Assam, Sontosh Mohan Dev, spelt out his visions of the new public sector and the vital role he wanted it to play in some of significant development projects of the country. The minister, with a reputation of being an achiever par excellence also spelt out the difference in the UPA and the NDA approach to disinvestment and development of the North East. The extensive interaction also led to discussion on important political issues, including the prospects of his party in the coming elections in Haryana, Jharkhand and Bihar and the special interest being taken by the UPA Government and Prime Minister Dr. Manmohan Singh in the development of the North East and solving the problems of the Silchar and surrounding areas from the devastating rampages of Barak, the river of sorrow for the valley named after it. In this cover story, the DayAfter presents excerpts from the exclusive interview granted by Sontosh Mohan Dev to the Think Tank Team of Editor-in-Chief Sunil Dang and Think Tank Director Yogendra Bali.

Editor-in-Chief Sunil Dang asked the minister about the task entrusted to him by the Prime Minister Dr. Manmohan Singh about the study of the current profile of the private sector and make recommendations on solving its problems and ensuring its rejuvenation, Shri Sontosh Mohan Dev said that committee was formed to study the Public Sector profile and make recommendations on giving more powers and autonomy to the PSUs. The minister selected some of the top experts in the field. He was told that they had already done excellent work. He said the experts who constituted the committee had told him that this work might prove to be a "hot cake". The committee had been given full liberty to complete its task. The Committee of Secretaries had also received its recommendations and the proposal in this regard is expected to the placed for approval of the competent authority very soon.

When Sunil Dang observed that after this study it would be safe to assume that the public sector was safe in the hands of the Union Minister for Industries, the minister with his characteristic smile, brushed aside the compliment and explained that the intention was to give more powers to the public sector. He pointed out that if action on a particular issue was to be taken in a private sector company, the decision about it could be taken within four hours. But in a public sector undertaking, if number of equipments were sought to be acquired, it could take at least one month because the approval of this committee, that committee and sub-committee would be required.

The minister shared his experience about the issue of idle labour in a company. He said he had once the opportunity to ask the top management of a famous private sector company about how much of idle labour they had. He was told that the idle labour level was the minimum there, "because we do not keep idle labour on any particular day". There could be only two main reasons for labour in a corporate being idle, the non performance of the manage-ment and the employees. The non performance of the employees stemmed from non-implementation of their legitimate demands by the management. "But we take care of the employees’ problems even before they can raise their demands. We have a system of discussing their performance and we take care of their legitimate needs and demands before they come up before us. And also our decision-making is much faster than your public sector". The fact that the minister shared this experience with the Think Tank team showed that his interest in introducing all the inputs and attitudes into the PSUs which would put them on par with the private sector in terms of performance and profitability.

Yogendra Bali sought the minister’s response to problems of the industries and his own ministry during the eight months he had been in the saddle as the Union Minister of Heavy Industries. Shri Dev’s response was free and frank. The minister pointed out that it was basically the Ministry for Industries which was now called the Ministry of Heavy Industries which he headed. The industries which were functioning well had been divided under the responsibility and supervision of many ministries. Some of the growth based industries were also common under his own ministry while the Coal India was under Coal Ministry, Oil and Natural Gas and Oil India were under the Petroleum Ministry and SAIL under the Steel Ministry. His own ministry had under its direct charge of 47 public sector companies out of which 9 were profit-makers and the remaining were either sick or those which had already closed down. Some of the sick industries were really in very bad shape. According to the Common Minimum Programme, the UPA Government wanted that the problems of these industries should be tackled with a human face. So, where possible, the sick companies should be made viable. And as per the assurance given by the Finance Minister Shri P. Chidambaram in the last Finance Bill, a Committee for the Restructuring of the Public Sector Undertakings had already been formed under the Union Ministry of Heavy Ministries and it was headed by Shri P. K. Basu and important secretaries. The Committee was looking at special problems of specific PSUs stage by stage. If a public sector company, now sick, was ground capital of being viable, this would be recommended to the Cabinet. The process had already started.

Union Ministry of Heavy Ministries and it was headed by Shri P. K. Basu and important secretaries. The Committee was looking at special problems of specific PSUs stage by stage. If a public sector company, now sick, was ground capital of being viable, this would be recommended to the Cabinet. The process had already started.

Sontosh Mohan Dev said, ‘But while doing so, we have taken a very important decision which is more of a humanitarian step than anything else. Rs. 517 crores have been paid as arrears of salaries, pensions, provident fund and VRS to employees of several PSUs till July 2004 by my government after I came here and that has created an environment of confidence among the workers that the UPA government is serious in utilising them. With this spirit we are going ahead with Operation of the Restructuring Committee which has already judged about half a dozen specific cases. We have not got the report as yet but we will get it and try to revitalise these sick units. But a decision has been made in the Cabinet, a day before you came to talk to me, that further offloading of the shares of the profit-making PSUs will be done and a corpus will be created out of that. From that corpus the government will take up some of the problems of social orientation reforms like education, development, backward communities and backward areas. Of that corpus (The National Investment Fund), 75 per cent of the money will be spent on social welfare and human development projects. Out of the balance 25 per cent, part of the money will be spent to improve the health of sick PSUs recommended for revival by the Reconstruction Committee, through my ministry and the Finance Ministry. This is also another achievement because there was a question mark in the national press, where would the money come from? Are people going to be taxed further? Are we going to sell our (public) properties? We are only going to sell the sick properties but that too we shall do by auctioning and not through private negotiations".

To the question that would the NIF provide funds from its corpus for the revival of the sick PSUs, the minister said, "Yes". The minister further responded to the media speculation about the Union Industry Minister’s move to offload some of the shares of the profit-making PSUs like BHEL and Maruti being shelved by the Cabinet Committee for Economic Affairs. He said that the step was postponed not shelved. He explained that through offloading of some of their shares profit-making undertakings like Maruti and BHEL would do better. The moment the news of such a measure got about the Sensex jumped in a single day. So this had been proved that the stock market would positively respond to such a move.

The Think Tank team pointed out that the debate in the media was on about what should be the disinvestment norms. And what would be such a principle for both the sick and the profit-making PSUs which had earned the distinction of being considered Navratnas or the Nine Jewels? The previous NDA Government was criticised for having gone around "indiscriminately disin-vesting the PSUs" now the UPA government was also talking of disinvestment of PSUs.

The minister said there was a difference between the approaches of the NDA and the UPA "We are not doing that to cover the budget deficit. Our approach is that money raised from disinvestment will be used for rejuvenating and reviving the public sector itself"

New Investment Approach The UPA Government has decided to take a new approach to public sector investment. The money which comes from disinvestment of some of the public sector undertakings will be used for financing the public sector financial institutions to which shall provide funds for the public sector. The money could be reinvested through institutions like the IDBI, Mutual Fund Trust. The interest that will come from that investment will be invested in the public sector revitalisation. The invested money in the financial institutions will remain safe and intact. So, money will remain safe and also continue to increase. On the lines of the Steel Development Fund, which Sontosh Mohan Dev had instituted while he was the Minister for Steel, this fund will also provide money for even the private sector companies at reduced rates of interest. Those small and big companies that return the loans on time will benefit. But the conditions will be kept harsh for those who do not return the loans on time, to ensure that the money is not wasted.

The Dev Magic

Does the Union Minister for Heavy Industries have some kind of a magic in his sleeves that even the left parties element backing the UPA Government, who generally perform the critical role of taking the Government to task whenever they feel that the policies and programmes do not fit in with their concept of peoples’ interests, support when Sontosh Mohan Dev even talked of disinvestment. As the minister told the DayAfter Think Tank, he had no magic. In fact he complimented the left parties and their leaders and said they were doing much more in cooperation with the private sector in West Bengal. Of course they had made one thing clear that there should be no retrenchment of employees. And of course "We will not just sell the public properties and we have accepted their viewpoint. I find they are much reasonable and cooperative. Of course for public consumption they might say anything."

Silchar and Its River of Sorrow

The Heavy Industries Minister Sontosh Mohan Dev, never forgets his own Cachar area and the Silchar Lok Sabha constituency where his personal popularity and credibility of his social activist wife, is much more than the state and the union governments as such. He is well conversant with each and every problems and need of the people of Silchar and the Barak Valley and the sorrow river Barak spreads every year when it is on the rampage.

He told the DayAfter Think Tank that this year the Barak had wrought up not once or twice but three times. The damage which occurred to our roads, the erosion that was suffered by our villages was extensive. Yes, we have not been able to recover from the blow. Your comment is correct. One year’s time has been given by the Central Government to repair the damage but the North Eastern Council was not able to do much. The process of reconstruction has not yet started. People are very unhappy. They do not believe we are doing anything. The work has not yet been allotted although one year was given for its completion. My own election promise was that we shall find a permanent solution for the Barak Valley problem. I had also promised that I shall take up the conversion of the meter gauge railway track to broad gauge. The work which was started during the United Front Ministry government with Shri Ram Vilas Paswan as the Railway Minister could not make much progress because of lack of funds. Now our present Prime Minister, Dr. Manmohan Singh has declared it a national project and Rs. 1500 crore have been allotted for it. The Prime Minister wants that it should be completed by 2009. It may spill over to 2010 or 2011 but now it will certainly take shape.

"The second important thing is the Tipaimukh Dam which is to be constructed at the junction of Manipur, Mizoram and Barak Valley which has been and outstanding demand of the people of Cachar region to tame the Barak. This work is now also being done and the Prime Minister’s office is taking special care to ensure that this work also come into reality. There are several costs – the security cost, the cost on the diversion of a road and the flood management cost. These costs would be about Rs. 700 odd crores. If this cost is loaded onto the project it become unviable. Efforts are therefore being made to ensure provision of funds in the budget of a particular ministry to take care of the costs. The Prime Minister’s Office is examining the possibilities on these lines. The first meeting in this respect was quite good and they have asked for the cost of the project to be maintained at the 2004 price level and submit it. If the project is through then the major problem of the Barak Valley would have been tackled which would change the entire life in Assam and the rest of the country.

In fact a task force has been constituted and given the task to study and recommend how this river of sorrow can be turned into a river of happiness. They are doing work on this.

Personal Priorities

Sontosh Mohan Dev, asked about his personal priorities, says "My personal priorities, apart from the plans and projects we have already made is to create new job opportunities for our boys, specially in the Barak Valley. So we are trying to improve the recruitment opportunities for them in public sector undertakings wherever we can because we have a lot of engineers sitting idle. We have an engineering college when I was a Steel Minister I employed about 200 young engineers. I am also trying to set up some kind of composite campus for cottage industries.

Sonia Magic will Work